Reflections on Section 402A of the Restatement (Second) of

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Reflections on Section 402A of the Restatement (Second) of Reflections on Section 402A of the Restatement (Second) of

Torts: A Mirror Crack’d Torts: A Mirror Crack’d

Charles E. Cantú St. Mary's University School of Law, [email protected]

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Recommended Citation Recommended Citation Charles E. Cantú, Reflections on Section 402A of the Restatement (Second) of Torts: A Mirror Crack’d, 25 Gonz. L. Rev. 205 (1989-90).

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REFLECTIONS ON SECTION 402A OF THERESTATEMENT (SECOND) OF TORTS: AMIRROR CRACK'D*

Charles E. Cantu**

(1) One who sells any product in a defective condition unreasona-bly dangerous to the user or consumer or to his property is subject toliability for physical harm thereby caused to the ultimate user or con-sumer, or to his property, if

(a) the seller is engaged in the business of selling such a product,and

(b) it is expected to and does reach the user or consumer withoutsubstantial change in the condition in which it is sold.

(2) The rule stated in Subsection (1) applies although(a) the seller has exercised all possible care in the preparation and

sale of his product, and(b) the user or consumer has not bought the product from or en-

tered into any contractual relation with the seller.'

In 1965 the American Law Institute2 published Section 402A of theRestatement (Second) of Torts and forever changed the means by whichan individual would be held liable for placing a defective product into thestream of commerce.3 Strict liability, which had been previously re-

Out flew the web and floated wide;The mirror crack'd from side to side;'The curse is come upon me.' criedThe Lady of Shalott.The Lady of Shalott by Alfred, Lord Tennyson.

* Professor of Law, St. Mary's University School of Law; B.A., University of Texas;J.D., St. Mary's University; M.C.L., Southern Methodist University; L.L.M., University ofMichigan, Fulbright Scholar.

1. RESTATEMENT (SECOND) OF TORTS § 402A (1965).2. The individual members at the time were: Francis M. Bird. Esq., Professor lau-

rence H. Eldredge, Professor James Fleming, Jr., Professor Robert E. Keeton. Dean W. PageKeeton, Judge Calvert Magruder, Professor Wex Smathers Malone, Professor Allan H. Mc-Coid, Dean William L. Prosser, Dean Samuel D. Thurman, Jr., Chief Justice Roger .J. Tray-nor, and Dean John W. Wade.

3. Generally, before the publication and widespread adoption of the Restatement(Second) of Torts section 402A, unless an injured plaintiff could qualify for one of the fewnarrow exceptions in strict liability, he or she had only the choice between a traditionalnegligence action or a contract action based on warranty. Under traditional negligence, the

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stricted to cases involving dangerous activities" and wild animals,' becamea new cause of action in almost all product cases.' As a result, this sectionof the Restatement has been a catalyst to a multitude of litigation. Thenumber of lawsuits arising from this one promulgation can be describedas nothing less than explosive.7 More causes of action have been brought

individual charged with placing a defective product in the stream of commerce could safelyrely on privity to escape liability. See generally McCormack v. Handscraft Co., 278 Minn.322, -, 154 N.W.2d 488, 499-500 (1967) (court stated that this traditional limitation didnot appeal to a sense of justice). See also Dippel v. Sciano, 37 Wis. 2d 443, -, 155 N.W.2d55, 58-63 (1967) (discussing the evolution and policies involved in elimination of privityrequirement). As for a contract action on warranty, the defendant could safely hide behinddisclaimers and limitations. See Henningsen v. Bloomfield Motors, Inc., 32 N.J. 358, -, 161A.2d 69, 87 (1960) (standardized limited warranties in auto industry result in "gross ine-quality" of bargaining position for consumer).

4. Strict liability for dangerous activities is most often traced back to an 1868 Englishcase in which water stored in a reservoir on Mr. Ryland's property flooded Mr. Fletcher'scoal mines. See Rylands v. Fletcher, L.R. 3 H.L. 330 (1868). The English court held that

the person who for his own purposes brings on his lands and collects and keepsthere anything likely to do mischief if it escapes, must keep it in at his peril, andif he does not do so, is prima facie answerable for all the damage which is thenatural consequence of its escape.

Id. at 339-40.

Since then the policy, which has evolved to include personal injury as well as propertydamage, has come to have its own set of definitions, rules, and exceptions independent ofother theories of strict liability. See Luthringer v. Moore, 31 Cal. 2d 489, -_, 190 P.2d 1, 8(1948) (use of cyanide compound by a pest exterminator); see also Siegler v. Kuhlman, 81Wn.2d 448, 459, 502 P.2d 1181, 1184 (1973) (hauling gasoline as freight), cert. denied, 411U.S. 983 (1973). The second Restatement sets forth the law of strict liability for dangerousactivities essentially as it was propounded in Rylands. See RESTATEMENT (SECOND) OF TORTS

§§ 519, 520 (1965).5. It is well settled that "one who harbors a wild animal, which by its very nature is

vicious and unpredictable, does so at his peril, and liability for injuries inflicted by suchanimal is absolute." Collins v. Otto, 149 Colo. 489, -, 369 P.2d 564, 566 (1962) (coyote);Briley v. Mitchell, 238 La. 551, -, 115 So. 2d 851, 854 (1959) (wild deer; owner liable forinjuries caused regardless of how animal escaped). Even municipal corporations, whichcould traditionally rely on immunity, have been held liable where a wild animal is con-cerned. See Moloney v. City of Columbus, 2 Ohio St. 2d 213, 208 N.E.2d 141 (1965). Aguano housed at the city zoo bit and injured a young girl. Id. at -, 208 N.E.2d at 142. Thecourt held the city strictly liable. Id. at -, 208 N.E.2d at 146.

6. In most product liability suits, the pattern is to allege a claim of negligence, abreach of warranty as set forth in the Uniform Commercial Code, and a claim for strictliability in tort. See generally W. KIMBLE & R. LESHER, PRODUCTS LIABILITY § 11, at 17(1979); see also U.S. DEPARTMENT OF COMMERCE, INTERAGENCY TASK FORCE ON PRODUCT LIA-BILITY: FINAL REPORT (1977) (recounting statistics of burgeoning claims in strict productliability).

7. See Bivins, The Products Liability Crisis: Modest Proposals for Legislative Re-form, 11 AKRON L. REV. 595, 598 (1978) (describing products liability reform as a "volatile"area of law).

PRODUCT LIABILITY

alleging strict liability for injuries caused by a defective product than inany other area of tort law.8

Now that almost two-and-one-half decades have passed since theadoption of this rule, much of the early uncertainty associated with it hasabated. For the most part, the concept and its elements have been clearlyestablished and universally accepted.' Now is a good time to look back,consider what the drafters of this section intended, and reflect on thejudicial changes that have been brought about as a result of itsenactment.

I. HISTORICAL BACKGROUND

What should be emphasized to law students and young attorneysalike is that this particular rule, unlike other sections of the second Re-statement, was not a previously accepted doctrine. At the time of itsadoption, it represented neither a majority nor minority position in theUnited States.10 As far back as the early 1940's, only concurring and dis-

8. While statistical findings vary from sample to sample, in general the reports sup-port the proposition that products liability suits outnumber other types of tort actions. Seegenerally Viscusi, The Determinants of the Disposition of Product Liability Claims andCompensation for Bodily Injury, 15 J. LEGAL STUD. 321, 326-27 (1986). One sample taken inthe federal court system reported that the broad category of products liability suits esca-lated from 1,579 in 1974 to 8,994 in 1982. Id. at 321 n.1. In cases where strict liability andnegligence were alleged, strict liability was emphasized as the primary action in the majorityof the suits. Id. at 327. Where strict liability, negligence, and breach of warranty were al-leged, strict liability was slightly more emphasized. See id. at 328. In 1976 the United StatesInteragency Task Force on Products Liability estimated lawsuits of this nature at between60,000 and 70,000 and rising at a dramatic rate. See Hearing on Products Liability ReformBefore the Senate Comm. on Commerce, Science and Transportation, Subcomm. on theConsumer, 97th Cong., 2d Sess. 257 (1982) (statement of Senator Robert W. Kasten(R.Wis.)), as reported in AMERICAN ENTERPRISE INSTITUTE FOR PUBLIC POLICY RESEARCHLEGISLATIVE ANALYSIS PUBLICATION: FEDERAL PRODUCTS LIABILITY PROPOSALS 1984, 98thCong., 2d Sess. 5-6 (1984); see also Galanter, Reading the Landscape of Disputes: What WeKnow and Don't Know (and Think We Know) About Our Alleged Contentious and Litig-ious Society, 31 UCLA L. REv. 4, 69 (1983) (contemporary increase in litigation caused bychanging social conditions such as greater knowledge of injury causation and better dissemi-nation of such knowledge to consuming public).

9. See, e.g., East River Steamship Corp. v. Transamerica Delaval, Inc., 476 U.S. 858,865-66 (1986) (Supreme Court recognizing strict products liability as part of general mari-time law); McKisson v. Sales Affiliates, Inc., 416 S.W.2d 787, 789-90 (Tex. 1967) (TexasSupreme Court adopting section 402A strict liability); Morris v. Adolph Coors Co., 735S.W.2d 578, 582 (Tex. Ct. App. 1987), writ ref'd, no rev. err. (noting that strict productsliability adopted and applied in Texas since 1967).

10. See, e.g., Putman v. Erie City Mfg. Co., 338 F.2d 911, 919 (5th Cir. 1964). TheFifth Circuit court, fully aware that section 402A of the Restatement (Second) of Torts, inits final form, was moving toward adoption, intimated that since 1958, practically everycourt that had considered the question of applying strict liability had taken positions indi-

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senting opinions called for the application of strict liability to manufac-turers and/or sellers of defective products." In fact, many legal writershad been advocating such a position, 2 but until the time of its adoption,only one court had gone so far as to impose strict products liability.' Upto that point, the basis of liability in defective products cases had beeneither negligence, or express or implied warranty.

cating a favorable response to the new section as it was ultimately written. Id. at 919 n.19.However, in deciding Putman, the federal court noted the common obstacle: even thoughthe trend in Texas was toward strict liability, the Texas Supreme Court had not issued anopinion that could absolutely guide the Fifth Circuit as to Texas law. Id. at 912. Texas, likethe majority of states, had not officially embraced the spirit, much less the text of the sec-ond Restatement. See Titus, Restatement (Second) of Torts Section 402A and the UniformCommercial Code, 22 STAN. L. REV. 713 (1970). The Restatement reporter, Dean Prosser,evidently made a choice to present the section, as finally expressed, so that the new Restate-ment would not be outdated before it was released. Id. at 750.

11. See Escola v. Coca-Cola Bottling Co., 24 Cal. 2d 453, -, 150 P.2d 436, 438-40(1944). Technically, one of the earliest "dissents" in the area was not a dissent per se. In1944, Judge Traynor of the California Supreme Court concurred with a decision that al-lowed a waitress to recover for injury inflicted by an exploding soft drink bottle. The major-ity holding was based on the defendant's negligence and the court found all the require-ments necessary to entitle plaintiff to rely on the doctrine of res ipsa loquitur. JudgeTraynor, concurring in the result, dissented from the majority's reasoning and said "itshould now be recognized that a manufacturer incurs an absolute liability when an articlethat he has placed on the market, knowing that it is to be used without inspection, proves tohave a defect that causes injury to human beings." Id. at -, 150 P.2d at 440.

12. Judge Traynor's 1944 concept was not totally new by any means, but until then ithad only been espoused by legal writers. See K. LLEWELLYN, CASES AND MATERIALS ON THE

LAW OF SALES 341, 342 (1930). In 1930, Professor Llewellyn argued that the law should shiftthe immediate incidences of the hazards of life in an industrial society away from the indi-vidual and over to a group which could distribute the loss. See also Llewellyn, On Warrantyof Quality and Society, 36 COLUM. L. REv. 699, 704 (1936).

13. In 1962, Judge Traynor implemented this concept first articulated in 1944. SeeGreenman v. Yuba Power Products, Inc., 39 Cal. 2d 57, 377 P.2d 897, 27 Cal. Rptr. 697(1962). The plaintiff had been injured by a power tool and had given written notice to theretailer and the manufacturer of breaches of warranties, express and implied. He also suedon grounds of negligence, citing negligent design and inspection. Id. at __, 377 P.2d at 898,27 Cal. Rptr. at 698. In affirming the trial court's verdict for the injured plaintiff, the courtalso closed doors previously used by defendants. The court first outlined the tortious mazethrough which other courts had wandered to apply what was, in essence, strict liability. Id.at -, 377 P.2d at 900, 27 Cal. Rptr. at 700. The court said:

Although in these cases strict liability has usually been based on the theory ofan express or implied warranty running from the manufacturer to the plaintiff,the abandonment of the requirement of contract between them, the recognitionthat the liability is not assumed by agreement but imposed by law, and the refusalto permit the manufacturer to define the scope of its own responsibility for defec-tive products make clear that the liability is not one governed by the law of con-tract warranties but by the law of strict liability in tort.

Id. at -, 377 P.2d at 901, 27 Cal. Rptr. at 701 (citations omitted).

PRODUCT LIABILITY

The original Restatement of Torts published in the 1920's and 1930'sfollowed this traditional position, and included no provision for the appli-cation of strict liability.14 By 1961, however, Tentative Draft No. 6 of theRestatement (Second) advocated the adoption of section 402A. 15 Thisnew section, while recognizing that an individual could be held strictlyliable, limited the applicability of this rule to claims involving "food forhuman consumption.' 16 One year later, however, it became increasinglyapparent to the Institute that the Restatement (Second) had expressedthis revolutionary new concept much too narrowly.' 7 As a result, in 1962,Tentative Draft No. 7 extended the section to encompass " 'products in-tended for intimate bodily use,' 'whether or not [they] ha[ve] any nutri-tional value.' "18 This last provision was intended to clarify that suchproducts as "chewing gum, chewing tobacco, snuff, cigarettes, drugs,clothing, soap, cosmetics, liniments, hair dye, and permanent wave solu-tion" were included.'9 Apparently, the drafters of 402A felt that theseproducts, although intended for external use or application, were of such"an intimate character" that they warranted liability without fault ifdefective.20

The following year Justice Traynor, a member of the Institute, futureChief Justice of the Supreme Court of California, and major supporter ofthe concept of strict liability for injuries caused by defective products,2'wrote the opinion in the landmark case of Greenman v. Yuba PowerProducts, Inc.2 2 The plaintiff in Greenman had been injured when ashopsmith-a power tool that could be used as a saw, drill, and woodlathe-unexpectedly ejected a piece of wood he had been working on andcaused serious injuries.2" In the product liability suit which followed, theissues submitted to the jury included breach of implied warranties againstthe manufacturer.24 The jury returned a verdict in favor of the retaileragainst the plaintiff, and in favor of the plaintiff against the manufac-

14. See Putman v. Erie City Mfg., 338 F.2d 911, 918 (5th Cir. 1964) (outlining progressand development of section 402A).

15. Id; see also Titus, supra note 10, at 713.16. See Putman, 338 F.2d at 918.17. Id.18. Id.19. Id. at n.16 (citing RESTATEMENT (SECOND) OF TORTS § 402A (Tent. Draft No. 7,

1962)).20. Id.21. See Titus, supra note 10, at 720 (noting that Justice Traynor was adviser to Re-

statement (Second) of Torts and long-time supporter of strict products liability).22. 59 Cal. 2d 57, 377 P.2d 897, 27 Cal. Rptr. 697 (1962).23. Id. at -, 377 P.2d at 898, 27 Cal. Rptr. at 698.24. Id. at -, 377 P.2d at 899, 27 Cal. Rptr. at 699.

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turer.2 5 On appeal, the manufacturer alleged that it was not liable on thebasis of warranty because the plaintiff had failed to give notice of thebreach of warranty within a reasonable time as required by the UniformCommercial Code.26

Justice Traynor, in an unprecedented move, side-stepped the issue ofbreach of warranty and held the defendant liable on the basis of strictliability.27 Justice Traynor reasoned that strict liability under the guise ofbreach of warranty, whether express or implied, had in reality been inexistence for quite some time.28 Recognized first in the area of unwhole-some food products, the doctrine was subsequently extended to includeother products where the hazard was equally as great.29 Traynor stressedthat

the abandonment of the requirement of contract between [the parties],the recognition that the liability is not assumed by agreement but im-posed by law, and the refusal to permit the manufacturer to define thescope of its own responsibility for defective products make clear that theliability is not one governed by the law of contract warranties but by thelaw of strict liability in tort.30

II. SECTION 402A

In 1964, the Institute approved the final draft of section 402A, whichmade the rule of strict liability applicable to all products. The inclusionof this provision marked the first time in the history of the Restatementthat a new section was added which was not supported by prior caselaw.3

1 Other than Yuba, no decision, much less a minority or majorityposition, had authorized such a recovery as that represented by 402A.32

This fact, however, along with the argument that strict liability invaded a

25. Id.26. Id.27. Id. at -, 377 P.2d at 900, 27 Cal. Rptr. at 700.28. Id.29. Id.30. Id. at -, 377 P.2d at 901, 27 Cal. Rptr. at 701 (citations omitted).31. Professor Titus succinctly states the argument that erupted over the adoption of

the rule and the proper role of the American Law Institute (A.L.I.). On one side stood thecritics who insisted that the Institute's role was to state the law as it would be decided bymost courts. This group took the position that "the adoption of Section 402A [was] an un-precedented departure" from the traditional role of the Institute. Titus, supra note 10, at747. However, Professor Titus avers that the 1923 A.L.I. organizational committee includedas one of its purposes the role of promoting changes that would better align the law "to theneeds of life." Id. at 748.

32. See Edmeades, The Citadel Stands: The Recovery of Economic Loss in AmericanProducts Liability, 27 CASE W. RES. 647, 663 (1977) (stating that cases in support of section

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field pre-empted by legislative enactment of the Uniform CommercialCode,3 did not prevent the section's adoption. In 1965, 402A was pub-lished as part of the Restatement (Second) of Torts.3 4 Although it metwith early opposition, 35 this section has become virtually the universalrule over cases which involve injuries caused by defective products.3 6

What has become clearer since 1965, however, is that the interpretationof section 402A may not in all cases be the same as that originallyintended.

402A, including Yuba, were not decided until after initial tentative drafts of sections werewritten); see also Noel, Strict Liability of Manufacturers, 50 A.B.A. J. 446, 447 (1964).

33. See Shanker, Strict Tort Theory of Products Liability and the Uniform Commer-cial Code: A Commentary on Jurisprudential Eclipses, Pigeonholes and CommunicationBarriers, 17 W. RESERVE L. REV. 5, 23 (1965). Some scholars contended that the UniformSales Act, predecessor of the Uniform Commercial Code (U.C.C.), did not provide essentialelements for a "modern sense of justice." Article 2 of the U.C.C., on the other hand, wasregarded favorably, and section 402A was consequently regarded as "not necessary norwise." Id.

Professor Shanker pointed out that in the early sixties, when strict products liabilityconcepts were being formulated, the official text of the 1962 U.C.C. was in the process ofgradual adoption by the state legislatures. Id. at 5. He contended that the early cases in tortwere decided in favor of strict liability simply because the U.C.C. was not yet in effect incertain states. Id. at 22. In 1965, Professor Shanker applauded the results of these decisions,but stated that the U.C.C. should provide any further necessary relief. Id. at 47. By 1978,however, he was apparently outraged by a perceived favoring of the Restatement positionover legislative enactments by courts. See Shanker, A Case of Judicial Chutzpah (The Ju-dicial Adoption of Strict Tort Products Liability Theory), 11 AKRON L. REV. 697, 705(1978). But see Rapson, Products Liability Under Parallel Doctrines: Contrasts Betweenthe U.C.C. and Strict Liability in Tort, 19 RUTGERS L. REV. 692, 712 (1965) (noting thatjudge-made strict products liability law "bypasses" the U.C.C., but is necessary to fill thevacuum left by Code drafters).

Some writers have alleged that comment m of section 402A was an attempt to bypassinterference from the U.C.C. See Dickerson, Was Prosser's Folly Also Traynor's? or Shouldthe Judge's Monument be Moved to a Firmer Site?, 2 HOFSTRA L. REV. 469, 477 (1974).Comment m states that section 402A is not governed by the Uniform Sales Act nor theU.C.C. See RESTATEMENT (SECOND) OF TORTS § 402A comment m (1965). One writer hasstated that "[a] more beautiful example of bootstrap-pulling, not involving the pain of read-ing the statute, would be hard to imagine. And the amazing thing is that for most judgesand pedagogues, Dean Prosser got away with it." Dickerson, supra, at 477.

34. RESTATEMENT (SECOND) OF TORTS § 402A (1965).

35. See generally Smyser, Products Liability and the American Lai Institute: APetition for Rehearing, 42 U. DET. L.J. 343 (1965).

36. See Goldberg, Manufacturers Take Cover, 72 A.B.A. J. 52 (July 1986); see also W.KIMBLE & R. LESHER, PRODUCTS LIABILITY § 2, at 14-16 & n.41 (1979). As of 1979, approxi-mately twenty-six jurisdictions follow section 402A as written, and an additional six stateshave expanded its application in various ways. Others have adopted strict liability conceptswithout expressly applying 402A. Id.


A. "One who sells . . ."

From the beginning, the section was intended to apply to situationsinvolving the sale of a product.17 The early cases not only supported, butwere adamant on this point."8 It did not take long, however, for the inge-nuity of plaintiffs' attorneys and courts, eager to adopt the strict productliability doctrine, to apply the rule to other types of transactions. Leaseagreements were the first extension. In Cintrone v. Hertz Truck Leasing& Rental Service, 9 the court noted that in today's modern society it ispossible to lease anything that can be purchased. 0 In discussing the situ-ation of a leased vehicle, the court stated: "A bailor for hire, such as aperson in the U-drive-it business, puts motor vehicles in the stream ofcommerce in a fashion not unlike a manufacturer or retailer.""' This sub-jects a leased vehicle "to more sustained use on the highways than mostordinary [purchased] car[s]," and exposes "the bailee, his employees, pas-sengers and the travelling public . . . to a greater quantum of potentialdanger of harm from defective vehicles than usually arises out of sales bythe manufacturer." '4 2 On this basis, the New Jersey court held that strictliability should and would be applicable to the lessor of a defective prod-uct, even though no sale had taken place. ' If the courts could hold the

37. See RESTATEMENT (SECOND) OF TORTS § 402A comment c (1965) (justification forthe rule stems from the fact that a seller has responsibility for its product); see also Prosser,The Fall of the Citadel (Strict Liability to the Consumer), 50 MINN. L. REV. 791, 814-16(1966). The author makes it clear that a sale must be involved at some point in the commer-cial chain from manufacturer to consumer in order for strict products liability concepts toapply. Id. at 814-15; see also R. EPSTEIN, MODERN PRODUCTS LIABILITY LAW 60 (1980) (sec-tion 402A extends strict liability principles to all members in the chain of distribution).

38. See Speyer, Inc. v. Humble Oil & Refining Co., 403 F.2d 766, 772 (3d Cir. 1968),cert. denied, 394 U.S. 1015 (1969). The court held that if a defendant was not also the sellerof the product in question, section 402A would not apply. Id. The court drew a distinctionbetween "sellers" and "suppliers." Sections 407 and 408 of the second Restatement dealdirectly with lessors' liability, based on negligence principles rather than strict liability. Id.at n.10. Therefore, section 402A was presumably not intended to apply to lessors. See id.;see also Barbee v. Rogers, 425 S.W.2d 342, 346 (Tex. 1968) (court refusing to extend strictliability to include improper fitting of contact lenses prescribed for plaintiff because fittingregarded as service not sale); Shivers v. Good Shepherd Hosp., Inc., 427 S.W.2d 104, 107(Tex. Civ. App. 1968), writ ref'd, no rev. err. (refusing to hold hospital liable for injuriescaused by injection of contaminated medication).

39. 45 N.J. 434, 212 A.2d 769 (1965).

40. Id. at -, 212 A.2d at 776.

41. Id. at -, 212 A.2d at 777.

42. Id.

43. Id. at -, 212 A.2d at 777-78, 781.

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seller of a defective product strictly liable,4 there seemed to be no diffi-culty in extending this idea to a non-sale/lease transaction."'

Once freed from the parameters of the sales limitation, 402A wassoon applied to other types of bargains. For example, in subsequent cases,strict liability has been the basis of recovery for injuries caused by a de-fective product used in demonstrations."' The transactions were furtherexpanded to include free samples given to a prospective customer, 7 com-plimentary gifts that accompanied the sale of a product," and productsloaned for the purpose of demonstration.' It has become clear from thesedecisions that the original phrase "one who sells" should now be inter-preted to mean "one who places into the stream of commerce."' 0 As longas the product causing the injury has been placed in the market, strict

44. Id. at -, 212 A.2d at 781.

45. Id. at -, 212 A.2d at 779; see also Price v. Shell Oil Co., 2 Cal. 3d 245, 251-52, 466P.2d 722, 726, 85 Cal. Rptr. 178, 181 (1970). The court stated, "Similarly we can perceive nosubstantial difference between sellers of personal property and non-sellers, such as bailorsand lessors." Id. The thrust of the court's opinion was that the policy justifications applyingto sellers of defective products apply with equal force to lessors of such products.

A restriction which has persisted is that the defendant, to be held strictly liable, mustbe in the business of placing the product in question into the marketplace. See Freitas v.Twin City Fisherman's Coop. Ass'n., 452 S.W.2d 931, 938 (Tex. Civ. App. 1970), writ ref'd,no rev. err. (defendant oil company held not liable for injuries caused by defective ladderand platform oil tank installed by independent contractor). See generally Prosser, supranote 37, at 814 (predicting that section 402A cannot apply to those sellers not regularlyengaged in the sale of the product at issue). But see Thomas v. St. Joseph Hosp., 618S.W.2d 791, 796 (Tex. Civ. App. 1981), writ ref'd, no rev. err. (hospital held strictly liablefor supplying defective hospital gown because not related to primary professional servicerelationship between plaintiff and defendant).

46. See, e.g., Delaney v. Towmotor Corp., 339 F.2d 4, 6 (2d Cir. 1964) (defendant heldstrictly liable for injury caused by forklift provided as demonstrator model to plaintiff'semployer); First Nat'l Bank v. Cessna Aircraft Co., 365 So. 2d 966, 968 (Ala. 1978) (profitmotive is apparent whenever defendant has placed product in stream of commerce, whetheror not sale has taken place).

47. See, e.g., McKisson v. Sales Affiliates, Inc., 416 S.W.2d 787, 792 (Tex. 1967) (de-fendant strictly liable for injuries caused by free sample of defective permanent wave solu-tion given by defendant to plaintiff).

48. See, e.g., Perfection Paint & Color Co. v. Konduris, 147 Ind. App. 106, -, 258N.E.2d 681, 688 (1970) (can of paint provided as free sample held to be within scope ofsection 402A).

49. See, e.g., Delaney, 339 F.2d at 6 (defendant held strictly liable for injury caused byforklift loaned to plaintiff's employer by seller of such equipment); see also McClaflin v.Bayshore Equip. Rental Co., 274 Cal. App. 2d 446, -, 79 Cal. Rptr. 337, 340 (1969) (bailorof maintenance equipment held strictly liable for death of bailee resulting from defectiveladder provided).

50. Delaney, 339 F.2d at 6.

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liability is applicable notwithstanding the fact that no sale has takenplace." The rationale for this position is that

When a product is placed in the 'stream of commerce,' the marketingcycle as it were, whether by demonstration, lease, free sample or sale, thedoctrine should attach. In each of these situations the profit motive ofthe manufacturer is apparent whether or not a 'sale' in the strict sensetakes place. Moreover, the manufacturer who enters the market is in abetter position to know and correct defects in his product and as be-tween him and his prospective consumers should bear the risk of injuryto those prospective consumers when any such defects enter the marketuncorrected.

2

All of these reasons for applying liability without fault in a pure salestransaction appear to be applicable to any method of distribution oncethe product in question enters the market place. The seller's profit mo-tive, coupled with the idea that the vendor should bear the risk of lossover an innocent consumer, prevails even when the defective product en-ters the stream of commerce in a non-sale transaction.

B. "[A]ny product . . ."

Other than New Jersey, 53 which allows a strict liability action in situ-ations where the defendant has provided a service, all jurisdictions limitthe applicability of 402A to situations involving a product. 4 In imposingthis requirement, the courts have adhered to a strict interpretation of thesecond Restatement's position. This adherence is founded on the viewthat individuals like lawyers, doctors, engineers, and other persons who

51. Id.; see also First Nat'l Bank v. Cessna Aircraft Co., 365 So. 2d 966, 968 (Ala.1978). The Alabama court discussed "the market cycle," and held that one of the principleunderlying policies of strict liability is to place the burden of accidental injuries due todefective products "upon those who market them." Id. at 968.

52. Id.; see also Atkins v. American Motors Corp., 335 So. 2d 134, 139 (Ala. 1976)("[Jlustification for new tort theory must be founded on ... notions of consumer protectionand on economic and social grounds, placing burden to compensate for loss incurred bydefective products on the one best able to prevent distribution of those products."); Hill,How Strict is Strict?, 32 TEx. B.J. 759 (1969). The author states that if a transactionthrough which a product was placed in the stream of commerce was "essentially commercialin character," then liability would attach under section 402A, and a sale per se would beirrelevant. Id. at 767.

53. Newmark v. Gimbel's, Inc., 54 N.J. 585, 258 A.2d 697 (1969) (no sound reason forrestricting liability to sales of goods).

54. See Hoffman v. Simplot Aviation, Inc., 97 Idaho 32, -, 539 P.2d 584, 587 (1975)(Restatement (Second) deals only with the sale of products and with one exception, nocourt has adopted strict liability for personal services).

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render services rather than sell products, practice inexact sciences. 55

Therefore, they should only be required to exercise their best judgment.5 6

Since virtually no one can guarantee the result of their work, these indi-viduals should only be held to the standard of the reasonable person.5 7 Inother words, strict liability should not be applicable to a damaging eventinvolving a service transaction.

The real question in many cases is whether the situation involves thesale of a product, so that 402A is applicable, or involves the rendering of aservice. Transactions which involve elements of both product sales andservices have generated their share of litigation." In response to this di-lemma, the courts have devised the "predominant factor" test, whichseeks to determine the main thrust of the transaction.59 Did the individ-ual sell a product with incidental services attached thereto, for example,installation of a water heater? 60 Or, was the main purpose of the transac-tion rendering a service with a product incidentally involved, such as fit-ting an individual with contact lenses?6" If the basis of the transaction isfound to be the sale of a product, the courts have unhesitatingly appliedstrict liability. If on the other hand, the predominant factor is found to bea service, section 402A is not applicable.6 1 In most cases, this "predomi-nant factor" test presents a question of fact for the jury. When, however,the issue is so clear that reasonable minds could not differ, the final de-termination of the issue would be for the court.

One notable exception to this sort of transaction concerns the use ofblood. Some jurisdictions maintain that blood transfusions involve the

55. See, e.g., Hoven v. Kelble, 79 Wis. 2d 444, -, 256 N.W.2d 379, 392-93 (1977)(moving from malpractice to strict liability appears dubious); see also Gagne v. Bertran, 43Cal. 2d 481, -, 275 P.2d 15, 21 (1954) (hiring experts does not justify expectations ofinfallibility).

56. See, e.g., Hodges v. Carter, 239 N.C. 517, -, 80 S.E.2d 144, 146 (1954) (attorneysexercise best judgment in duty entrusted to them).

57. Gagne, 43 Cal. 2d at __, 275 P.2d at 21.58. See, Sales, The Service-Sales Transaction: A Citadel Under Assault, 10 ST.

MARY'S L.J. 13, 18 (1978) (the area between pure sales and pure services has causedconfusion).

59. See Perlmutter v. Beth David Hosp., 308 N.Y. 100, 104, 123 N.E.2d 792, 794(1954) (when transfer of property is only incidental to a service, it is not a sales transaction).

60. See Kopet v. Klein, 275 Minn. 525, -, 148 N.W.2d 385, 390 (1967) (the transac-tion involved in the sale of a chattel and a related service, such as installation, causes thebuyer to expect an installed product).

61. See Barbee v. Rogers, 425 S.W.2d 342 (Tex. 1968) (strict liability not applied toprescription, fitting, and sale of contact lenses).

62. See Delta Ref. Co. v. Procon, Inc., 552 S.W.2d 387, 389 (Tenn. Ct. App. 1976) (nostrict liability for properly installing pump with a latent defect).

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GONZAGA LAW REVIEW

sale of a product, and as such strict liability is applicable.63 Other juris-dictions view the transaction as the rendering of a service, making 402Ainapplicable."' These two positions appear to be incapable of reconcilia-tion and the reader should be aware of this dichotomy.

Another problem with the sale of goods, which has given rise to muchlitigation, revolves around used, rather than new, products. Does strictliability apply when a used product has been introduced into the streamof commerce? The second Restatement is silent on this point, 5 and thejurisdictions that have addressed the question are divided.6 6 Those thattake the position that strict liability is not available for the sale of a usedproduct 7 reason that such a product is no longer within the original pro-duction and marketing chain. Therefore, the reasons for imposing liabil-ity without fault-the seller's ability to treat such liability as a produc-tion cost, 9 and the ability of a seller to exert pressure on themanufacturer to enhance the safety of the product 7°- are not present.Imposing liability would, in effect, make the original seller an insurer,holding that seller strictly liable for defects which could have arisen whilethe product was under the control of an intermediate consumer.

Supporters of the view that sellers of used products should be strictlyliable point out that the second Restatement makes no distinction be-tween products that are new and those that are used, but instead merelyspeaks in terms of any defective product. 1 Furthermore, sellers of a de-fective used product have profited by introducing this article into the

63. See Weber v. Charity Hosp., 487 So. 2d 148, 150 (La. Ct. App. 1986) (blood bank,as distributor, strictly liable).

64. See Zichichi v. Middlesex Memorial Hosp., 204 Conn. 399, -, 528 A.2d 805, 808(1987) (transaction labeled service is outside of product liability).

65. RESTATEMENT (SECOND) OF TORTS § 402A comment c (1965).66. See generally Comment, Used Products and Strict Liability: Where Public Safety

and Caveat Emptor Intersect, 19 CAL. W.L. REV. 330 (1983).67. See Peterson v. Lou Backrodt Chevrolet Co., 61 Ill. 2d 17, 329 N.E.2d 785 (1975)

(used car dealer could not be held strictly liable as a matter of law when there was noallegation as to whether the defect existed when product left manufacturer's control or wascreated by the dealer).

68. Id. at -, 329 N.E.2d at 787 (imposing strict liability on such facts would makethe car dealer an insurer against defects which may not have existed until after the chain ofdistribution was completed).

69. See Escola v. Coca Cola Bottling Co., 24 Cal. 2d 453, -, 150 P.2d 436, 441 (1944)(Traynor, J., concurring) (risk spread among public as a cost of doing business).

70. Dunham v. Vaughan & Bushnell Mfg. Co., 42 Ill. 2d 339, -, 247 N.E.2d 401, 404(1969) (strict liability arises from sellers' role in the marketing scheme and affords moreincentive for safety).

71. See Hovenden v. Tenbush, 529 S.W.2d 302, 306 (Tex. Civ. App. 1975) (nothing insection 402A or its comments would indicate that the rule is not applicable to merchants ofused products).

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stream of commerce. Therefore, the sellers, and not the innocent purchas-ers, should, like the manufacturers, wholesalers, or any other retailers,bear the loss of a damaging event. These jurisdictions have had no diffi-culty in extending the impact of 402A to an area that was either not in-tended to be included by the writers of this section or at least was notforeseen as an area of concern. Nevertheless, liability for used productshas been clearly established in some jurisdictions.

An additional area in which 402A has had an important impact in-volves real estate transactions. Even though the largest number of re-ported decisions deal with the doctrine of strict liability as it relates tothe sale of personal property, some courts have had little difficulty in ex-tending the idea from chattels to the sale of land72 and houses. 3 In fact,the concept that a house constitutes a product is widely accepted.14 Thisis especially true in situations where new homes are constructed by massproduction developers.75 The reasoning is that by employing mass pro-duction techniques, the developer resembles the manufacturer of chattelsand should be held liable accordingly.7"

Perhaps the greatest area of concern in future years is how far thecourts will be willing to extend this concept of a "product." As shown, thecourts have had little difficulty in expanding the impact of 402A to situa-tions not mentioned by the original text of the section, as well as to trans-actions involving non-chattels, such as those involving land and houses.Recent cases have gone so far as to hold that commodities, such as waterand electricity, constitute products for purposes of 402A.77 How muchfurther can this concept be stretched? Could contaminated air fromn anair conditioning unit, or the paved surface of a road or highway be consid-

72. See Avner v. Longridge Estate, 272 Cal. App. 2d 607, 77 Cal. Rptr. 633 (1969)(strict liability applied to house lots which subsided due to defective subsurface conditions).

73. See Hyman v. Gordon, 35 Cal. App. 2d 769, 773, 111 Cal. Rptr. 262, 264 (1973)(strict liability applied where design defect of residential building and installation of anobject on the building causes injury).

74. See Vincent v. Jim Walter Homes, Inc., 1978 Prod. Liab. Rep. (CCH) 8,278(when parties contract to build and purchase a home, the completed structure constitutes aproduct within section 402A).

75. See Schipper v. Levitt & Sons, Inc., 44 N.J. 70, __, 207 A.2d 314, 325 (1965) (nomeaningful differences between the mass-production of homes and the mass production ofautomobiles).

76. Id.77. See, e.g., Schriner v. Pennsylvania Power & Light Co., 348 Pa. Super. 177, -, 501

A.2d 1128, 1133 (1985) (electricity is a product for the purposes of strict liability undersection 402A); Aversa v. Public Serv. Elec. & Gas Co., 186 N.J. Super. 130, -, 451 A.2d976, 980 (1982) (where electricity is placed in the stream of commerce, principles of strictliability are applicable); Ransome v. Wisconsin Elec. Power Co., 87 Wis. 2d 605, -, 275N.W.2d 641, 648 (1979) (electricity is a product for the purposes of strict liability).

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GONZAGA LAW REVIEW

ered a product? The answer is limited only by the ingenuity, imagination,and foresight of future plaintiff's attorneys and courts sympathetic to theexpectations of consumers.

C. "[I]n a defective condition . .

Perhaps the part of 402A that has caused the most debate, spawnedthe most litigation, and evoked the most creativity from the courts con-cerns the concept of "defect."" s From the beginning, the drafters wereadamant that the purpose of this provision was not to impose absoluteliability where liability would attach merely because an injury had oc-curred.7 9 Instead, they advanced the position of strict liability, where lia-bility would arise because one had placed a dangerously defective productthat caused injury into the stream of commerce." As a result, establishingthe defect became the crux of all products liability cases.8 ' Initially, therewas some confusion as the courts struggled to define this element.8 2 Someof the confusion stemmed from the fact that the courts failed to recognizethe different stages during which a product may develop a defect, andinstead applied a uniform test in all situations. The courts did not recog-nize that the test used to determine whether a product was mismanufac-tured was not necessarily the appropriate test to determine whether theproduct was defective due to error in the designing or marketing pro-cess.13 In addition, if one considers that no product is ever technologicallyperfect, that at some level of investigation all goods are flawed, 4 then itbecomes necessary to utilize some judgmental standard to determine

78. See generally Fischer, Products Liability-The Meaning of Defect, 39 Mo. L. REV.339 (1974).

79. See Rooney v. Federal Press Co., 751 F.2d 140, 143 (3d Cir. 1984) (section 402Awas never intended to turn the manufacturer into an insurer for all its products).

80. The argument is founded on the literal reading of section 402A of the Restatement(Second) of Torts, which states that "[olne who sells any product in a defective conditionunreasonably dangerous to the user or consumer or to his property is subject to liability forphysical harm thereby caused to the . ..user or consumer, or to his property .... "

81. Vincer v. Esther Williams All-Aluminum Swimming Pool Co., 69 Wis. 2d 326, -,

230 N.W.2d 794, 798 (1975) (an unreasonably dangerous defective condition is a requisiteelement to strict liability).

82. Compare Heaton v. Ford Motor Co., 248 Or. 467, -, 435 P.2d 806, 808 (1967)(product is defective if it does not meet the reasonable expectations of the average user)with Phillips v. Kimwood Mach. Co., 269 Or. 485, -, 525 P.2d 1033, 1038 (1974) (utility ofproduct may be so high that change to alleviate danger may impair utility, or cost of changemay be so great that no one would buy the product).

83. See Keeton, Product Liability and the Meaning of Defect, 5 ST. MARY'S L.J. 30(1973).

84. See Weinstein, Twerski, Piehler & Donaher, Product Liability: An Interaction ofLaw and Technology, 12 DuQ. L. REV. 425, 430 (1974) (all products flawed at some techno-logical level); id. at n.11 (to metallurgist, all structures have flaws).

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when these conditions emerge as a "defect." This dilemma was eventuallysolved when it became apparent that when speaking in terms of defect,the courts were confronted with three different facets of the same prob-lem. It soon became apparent that a product could be defective eitherbecause it was mismanufactured, s5 misdesigned, s and/or mismarketed, 87

and that the most appropriate test for each is not necessarily the same.

1. Mismanufactured Products

The most appropriate means for determining whether a product isdefective because it has been mismanufactured is whether the product, asplaced into the stream of commerce, 8 meets the reasonable expectationsof the ordinary user-consumer.8 9 The objective approach is best suited forthis scenario, because the product causing the injury is different from therest of those produced by the defendant. In its defective condition, itstands alone. To illustrate, consider that when a product is mismanufac-tured it may be defective for one of two reasons: The manufacturer mayhave used substandard or non-complying raw materials,9" or the productmay have been misassembled.9 1 In either case, the item as introduced intothe market place is in a condition not intended by the manufacturer. Thebest test, therefore, in determining whether such a product is in fact de-fective is the reasonable expectations test:92 Considering the particular

85. See Pouncey v. Ford Motor Co., 464 F.2d 957, 961 (5th Cir. 1972) (in applyingAlabama law, the court of appeals stated that it is settled law that manufacturers' liability ispredicated upon negligence in design or manufacture; the jury was permitted to infer negli-gence from evidence of an actual defect in the product).

86. See McCormack v. Hankscraft Co., 278 Minn. 322, -, 154 N.W.2d 488, 498 (1967)(plaintiff was able to show that steam vaporizer which scalded a child was defectivelydesigned because manufacturer did not guard against the foreseeable danger that a childcould overturn it, even though a safe and practical alternative design was available).

87. See McCormick v. Bacyrus-Erie Co., 81 Ill. App. 3d 154, -, 400 N.E.2d 1009,1014 (1980) (manufacturer has duty to give adequate instructions for product use as well aswarnings against dangers in the use of its product).

88. See Heaton v. Ford Motor Co., 248 Or. 467, -, 435 P.2d 806, 308 (1967) (manu-facturer liable for an unreasonably dangerous product that is placed on the market).

89. Id. at __, 435 P.2d at 808 (unreasonably dangerous to user means dangerous to anextent beyond that contemplated by ordinary user).

90. See Pouncey v. Ford Motor Co., 464 F.2d 957, 961 (5th Cir. 1972) (there was evi-dence the defendant's supplier used "dirty" steel to manufacture defective fan blades andthe plaintiff produced expert testimony to show that the steel used was the proximate causeof the damaging event).

91. Curtiss v. Young Men's Christian Ass'n, 82 Wn.2d 455, 471, 511 P.2d 991, 1000(1973) (Hamilton, J., concurring in part, dissenting in part) (no question that plaintiff'sinjuries were caused by improper assembly).

92. RESTATEMENT (SECOND) OF TORTS § 402A comment g (1965) (among other ele-ments, defective condition is defined as that condition not contemplated by the user whichis unreasonably dangerous to the user).


characteristics and general usage of the product, as well as representa-tions concerning the product by advertisements or otherwise, were certainexpectations created regarding its use?93 If these expectations are not metand if, as a result, the item is unreasonably dangerous, then the productis deemed to be defective. 4 This standard is by no means universally ap-plied, and as to some products, such as food, the courts at first appliedother standards.9 In the final analysis, however, the reasonable expecta-tion test has been accepted by a majority of jurisdictions and appears tobe the best means of accomplishing the court's objective of determiningwhether the product in question is a defective one.

2. Misdesigned Products

The best way of determining whether a product is defective becauseit has been misdesigned is the risk-benefit analysis.96 Misdesigned prod-ucts hold the possibility of condemning the defendant's entire production

93. See Shapo, A Representational Theory of Consumer Protection: Doctrine, Func-tion and Legal Liability for Product Disappointment, 60 VA. L. REV. 1109, 1370 (1974). Inhis "Statement of the Thesis," Professor Shapo states that product disappointment dependson a portrayal made or permitted to be made by the seller. The portrayal is viewed incontext of the impression that it is reasonable for the consumer to receive from the adver-tised product's appearance as well as the widespread social consensus of the product's func-tion. Id.

94. See Hubbard, Reasonable Human Expectations: A Normative Model for Impos-ing Strict Liability for Defective Products, 29 MERCER L. REV. 465, 466 (1978) (does theproduct deviate from what it should be, and if so, is the deviation the reason for injury). Butsee Green, Strict Liability Under Sections 402A and 402B: A Decade of Litigation, 54 TEX.L. REV. 1185, 1211 (1976) .(consumer should be given credit for expecting product to bereasonably safe).

95. Some jurisdictions have followed what is known as the "foreign-natural" doctrinewhich emerged in Mix v. Ingersoll Candy Co., 6 Cal. 2d 674, 59 P.2d 144 (1936). In Mix, theCalifornia Supreme Court held that a chicken bone in a chicken pie could not be called aforeign substance and should have been anticipated. Thus, the dish was not unfit for humanconsumption. The foreign-natural view is clear cut as long as the object encountered is obvi-ously foreign. See, e.g., Athens Canning Co. v. Ballard, 365 S.W.2d 369 (Tex. Civ. App.1963) (burr in a can of peas); Brumit v. Cokins, 281 S.W.2d 154 (Tex. Civ. App. 1959), writref'd, no. rev. err. (glass in milkshake). However, many jurisdictions have rejected the for-eign-natural test in favor of the reasonable expectation test. See Zabner v. Howard John-son's, Inc., 201 So. 2d 824 (Fla. Dist. Ct. App. 1967) (consumer injured by walnut shell inbowl of maple-walnut ice cream). "The test should be what is 'reasonably expected' by theconsumer in the food as served, not what might be natural to the ingredients of the foodprior to preparation." Id. at 826.

96. See Phillips v. Kimwood Mach. Co., 269 Or. 485, -, 525 P.2d 1033, 1038 (1974)(utility of product may be so great that design change to alleviate danger may impairutility).


line."7 This approach takes into consideration that, unlike the producer ofa mismanufactured product, the defendant in these instances intended toplace the product into the stream of commerce in its present condition.9 8

In determining whether such a product is defective, the courts engage in abalancing test, weighing the risk involved in introducing the product intothe market place in its present condition against the burden of reducingor eliminating the risk of harm from the product.9" The outcome is thenweighed against the benefit that would arise from a safer design.'00 If,after the damaging event has occurred, it is determined that the benefitto society of a safer design would have been greater than the burden in-volved in reducing or eliminating the risk, the product is deemed to bedefective.101 If, on the other hand, the burden would have been greaterthan the benefit to be derived from eliminating or reducing the risk, theproduct is not defective. 0 2

When analyzing the burden of reducing or eliminating the risk, weare speaking in terms of an alternate design,' 3 which takes into accountsuch factors as cost,' 4 utility,'05 marketability,' 6 state of the art,' 7 and,

97. Id. at -, 525 P.2d at 1037 (a case in which the product claimed to be defectiveand dangerous due to misdesign is not as simple as a case of mismanufacture because allproducts in that line are the same).

98. Id. (the law assumes the manufacturer has knowledge of the product's dangeroustendency).

99. See Pike v. Frank G. Hough Co., 2 Cal. 3d 465, 470, 467 P.2d 229, 232, 85 Cal.Rptr. 629, 632 (1970) (reasonable care involves balancing the likelihood and gravity of harmagainst the burden to avoid the harm).

100. See Wade, On the Nature of Strict Tort Liability for Products, 44 Miss. L. 825,844 (1973) (is the social usefulness of product so high that defendant should not be liablefor the injuries).

101. See, e.g., Helicoid Gage Div. v. Howell, 511 S.W.2d 573, 577 (Tex. Civ. App.1974), writ ref'd, no. rev. err. (evidence showed that shatterproof material would have onlyincreased unit cost by approximately one dollar).

102. See, e.g., Garst v. General Motors Corp., 207 Kan. 2, -, 484 P.2d 47, 62 (1971)(defendant was not required to spend such sums of money to design a braking system thatwould price the product out of the market).

103. McCormack v. Hankscraft Co., 278 Minn. 322, -, 154 N.W.2d 488, 494 (1967)(product's defect could have been eliminated by adopting an existing alternative design).

104. See Magic Chef, Inc. v. Sibley, 546 S.W.2d 851, 854 (Tex. Civ. App. 1977), writref'd, no. rev. err. (court held that stove was defectively designed because a valve whichcould not have been accidentally turned on would have only cost manufacturer an addi-tional $1.50).

105. See Hagans v. Oliver Mach. Co., 576 F.2d 97, 100 (5th Cir. 1978) (plaintiff arguedthat the blade guard of a table saw should have been designed to be non-removeable; how-ever, the court held that because the guard was an obstruction to other standard uses, thesaw's utility would be substantially impaired if the guard could not be removed).

106. See Garst, 207 Kan. at -, 484 P.2d at 62.107. The phrase "state of the art" is subject to different interpretations. The emphasis

of the phrase "defective condition" means that the condition was not contemplated by the


of course, safety."'0 When dealing with the issue of benefit, however, weare concerned with a product where the risk of harm or the potential forharm has been greatly reduced."0 9 This test of analyzing the risk and ben-efit of a particular product is best suited for such common situations asthose where a defect is allegedly due to the absence of a safety device,such as a guard on a machine,"0 or an electrical interlock cut-off de-vice,"' or a safety on a gun." 2 In addition, multitudes of cases involveallegations of defects concerning fabrics that are inherently dangerous be-cause they have not been treated with an effective flame retardant chemi-cal, ' 3 or drain cleaners with chemical compositions that are too caustic. '14

In all of these instances, the burden of redesigning the product must beweighed against the resulting benefit, and as previously mentioned, if thebenefit outweighs the burden, the product is deemed defective. 1 5

consumer at the time the product left the seller's hands. See RESTATEMENT (SECOND) OF

TORTS § 402A comment g (1965). Thus a manufacturer should not be liable for a productthat met the level of scientific or technical knowledge at the time of the sale, even thoughthat knowledge may have been superseded at a later date. See Bruce v. Martin-MariettaCorp., 544 F.2d 442 (10th Cir. 1976). The question then becomes: what is the state of the artat the time of the sale? See Boatland v. Bailey, 609 S.W.2d 743, 749 (Tex. 1980).

108. See McCormack v. Hankscraft Co., 278 Minn. 322, -, 154 N.W.2d 488, 496(1967) (manufacturer subject to liability for failure to use reasonable care to protect againstunreasonable risk when product used for intended purpose).

109. See Dorsey v. Yoder Co., 331 F. Supp. 753, 760 (E.D. Pa. 1971), af/'d, 474 F.2d1339 (3d Cir. 1973) ($200 to $500 cutter guards on $8,000 slitter machine would not dimin-ish usefulness and would decrease seriousness of potential harm).

110. See Annotation, Products Liability: Duty of Manufacturer to Equip ProductWith Safety Device to Protect Against Patent or Obvious Danger, 95 A.L.R. 3d 1066(1979).

111. Fischer v. Cleveland Punch & Shear Works Co., 91 Wis. 2d 85, -, 280 N.W.2d280, 285 (1979) (manufacturer liable, inter alia, in failing to provide interlock switch thatwould make inadvertent tripping of control impossible).

112. Phillipe v. Browning Arms Co., 375 So. 2d 151, 155 (La. Ct. App. 1979) (evidenceof defect in safety mechanism or pin on shotgun that exploded sufficient to hold manufac-turer and importer liable).

113. See, e.g., Raymond v. Riegel Textile Corp., 484 F.2d 1025, 1026 (1st Cir. 1973)(flannelette material unreasonably dangerous without effective retardant in fabric); Ross v.John's Bargain Stores Corp., 464 F.2d 111, 112 (5th Cir. 1972) (seller could be held liable fordeath resulting from nightgown igniting while one foot away from heater); La Gorga v. Kro-ger Co., 275 F. Supp. 373, 381 (W.D. Pa. 1967) (seller of child's jacket which caught fire heldstrictly liable), alf'd, 407 F.2d 671 (d Cir. 1969).

114. See, e.g., Drayton v. Jiffee Chem. Corp., 395 F. Supp. 1081, 1089-90 (N.D. Ohio1975), modified and aff'd, 591 F.2d 352 (6th Cir. 1978) (manufacturer of liquid drain cleanerliable for chemical burns suffered by infant).

115. See, e.g., Mickle v. Blackmon, 252 S.C. 202, -. , 166 S.E.2d 173, 192 (1969) (man-ufacturer at little or no cost could change composition of knob on gear shift lever so as notto deteriorate and avoid exposing driver to impalement in a collision). But see Dreisonstokv. Volkswagenwerk, A.G., 489 F.2d 1066, 1073 (4th Cir. 1974) (if design change adds to price

PRODUCT LIABILITY

Two related issues regarding a misdesigned product include theproblems of misuse and obvious dangers. When a product has been mis-used, may the defendant be absolved of liability? The answer dependsupon whether such misuse was foreseeable." 6 If the manufacturers placedthe product into the stream of commerce, and could or should have fore-seen the misuse in question, then they remain liable for resulting injuriesunder the risk-benefit analysis." 7 Individuals are required to take fore-seeable misuses into consideration when engaged in the product design.Obvious dangers in the product, on the other hand, present a more com-plex analysis. In these instances, the injured party's contributory negli-gence must be factored into the damaging event."' If, for example, rea-sonably prudent persons would not have exposed themselves to thedanger in question, then defendants may escape liability on the basis ofthe injured party's contributory negligence." 9 If, however, reasonable per-sons would have used the product in its present condition, the defendantsmay remain liable for resulting injuries. 2 ° The theory behind this rule isthat the courts do not wish to reward individuals by absolving them ofliability when they have placed a product with an obvious design defectinto the stream of commerce. 2 '

Finally, it should be noted that like the test for mismanufacturedproducts, the risk-benefit analysis is not universally applied. However,this test appears to be the best means for accomplishing the courts' objec-tive, which is to determine whether the product in question is defective.

so as to take product out of price range and intended market, it may be unreasonable torequire adoption of change).

116. See Findlay v. Copeland Lumber Co., 265 Or. 300, -, 509 P.2d 28, 31 (1973) (usemust be so unusual that average user could not reasonably expect item to withstandmisuse).

117. Cornette v. Searjeant Metal Products, Inc., 147 Ind. App. 46, -, 258 N.E.2d 652,665 (1970) (Sharp, J., concurring) (misuse defense available when product used in mannernot reasonably foreseeable nor for a reasonably foreseeable purpose).

118. See Compo v. Schofield, 301 N.Y. 468, -, 95 N.E.2d 802, 804 (1950) (manufac-turer under no duty to guard against injury from obviously dangerous source).

119. Id. (manufacturer had right to expect persons would avoid contact when natureof article gives warning of danger).

120 See, e.g., Codling v. Paglia, 32 N.Y.2d 330, 340, 298 N.E.2d 622, 627, 345 N.Y.S.2d461, 468 (1973) (many articles defy detection of defect except by expert).

121. See Palmer v. Massey-Ferguson, Inc., 3 Wn. App. 509, 517, 476 P.2d 713, 719(1970) (manufacturer should not escape liability when product design was obviously bad).The court further supported its reasoning, stating, "[L]aw [should] discourage misdesignrather than encouraging it in obvious form." Id.

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3. Mismarketed Products

The test for determining whether a product has been mismarketed isthe risk-benefit analysis. 2 ' Once again, if an individual has intended tointroduce the product into the stream of commerce in its present condi-tion,12 the same concern with risk, burden,'124 and resulting benefit'2 5

must be applied to the fact situation at hand. The main difference be-tween a product that has been misdesigned and one that has been mis-marketed, however, is that instead of concentrating on an alternate de-sign, the courts in these latter instances must focus on the instructionsand warnings that accompany or should accompany the product. Thesetwo points differ in that instructions pertain to the effective use of aproduct, 26 whereas warnings deal with its safe use.12

1

Since it is impossible to warn and/or instruct users and consumers ofall possible risks inherent in the use of a particular item, the first ques-tion encountered is how much of an instruction or warning must begiven? 12

' The importance of this question is accentuated by two facts.First, it would appear that since the burden would always be to issueadditional information and the benefit would always be a safer product,then the decisions involving a mismarketed product would consistentlyresult in a finding of defect. However, the second fact, the law of dimin-

122. See Keeton, Products Liability-Inadequacy of Information, 48 TEx. L. REV. 398,403 (1970) ("[Tlhe question whether a product was properly designed is inseparable fromthe question whether adequate instructions are provided to insure safe usage."); see alsoMontgomery & Owen, Reflections on the Theory and Administration of Strict Tort Liabil-ity for Defective Products, 27 S.C.L. REV. 803, 844 (1976) ("[T]he reasonable -with-full-knowledge-test gives an important additional perspective to the meaning of 'unreasonablydangerous.' ").

123. See supra text accompanying note 98.124. See Pavildes v. Galveston Yacht Basin, Inc., 727 F.2d 330, 338 (5th Cir. 1984)

(burden of warning costs manufacturer little to prevent losses and avert harm).125. See Borel v. Fibreboard Paper Prod. Corp., 493 F.2d 1076, 1106 (5th Cir. 1973)

(user has right to make decision whether to be exposed to risk product entails).126. See, e.g., McCully v. Fuller Brush Co., 68 Wn.2d 675, 678, 415 P.2d 7, 10 (1966)

("Directions and warnings are intended to serve different purposes. The former are designedto assure effective use of the product; a warning on the other hand, is intended to assure asafe use.").

127. See, e.g., Brown v. Sears, Roebuck & Co., 136 Ariz. 556, -, 667 P.2d 750, 758(1983) ("Instructions are to be followed to secure the most efficient or satisfactory use of theproduct; warnings are instructions as to dangers that might occur if the instructions are notfollowed.").

128. See Twerski, Weinstein, Donaher & Piehler, The Use and Abuse of Warnings inProducts Liability-Design Defect Litigation Comes of Age, 61 CORNELL L. REV. 495, 514(1976). To be effective, a warning must be selective. To have impact, manufacturers mustselect carefully the dangers which are to become part of the consumer's reasoning processwhen using the product. Id.


ishing returns, soon becomes evident in these cases. If the instructionsand/or warnings become too voluminous, the individuals involved willmore than likely disregard this information.'29 Therefore, the burden be-comes one of issuing the right amount of information. This dilemma oftenbecomes clearer in hindsight than at the time the product was initiallyintroduced into the stream of commerce.' As a result, the test for deter-mining whether the aim of issuing adequate warnings and instructionshas been met is determined by the reasonable prudent person. Would areasonable person be satisfied by the amount of information given? 3' Ifthe answer is yes, then the product is not deemed to be defective. 2 If onthe other hand, a reasonable individual would have desired more data,the product is said to be defective in this regard, and the end result is theconclusion that the product has been inismarketed."'3

The next question that arises in this area is: To whom should thisinformation be given?'13 This issue becomes increasingly complex whendealing with a product that is capable of inflicting harm as it passes

129. See id. ("The story of the boy who cried wolf is an analogy worth contemplatingwhen considering the imposition of a warning in a case of rather marginal risk.").

130. Griggs v. Firestone Tire & Rubber Co., 513 F.2d 851 (8th Cir. 1975), cert. denied,423 U.S. 865 (1975). In Griggs, components of a wheel rim assembly were mismatched by aprior owner. This damaging event occurred more than 25 years after manufacture of thepart. The manufacturer had distributed literature to wholesalers and retailers warning ofthe danger of mismatching components. The court held that it was unreasonable for a sup-plier to entrust distribution of the safety information to middlepersons in the distribution,when it was possible to affix warnings to the components themselves.

131. RESTATEMENT (SECOND) OF TORTS § 402A comment g (1965), describes a productas defective when it is "in a condition not contemplated by the ultimate consumer." It ismaking the user/consumer aware of such a condition that is the purpose of an adequatewarning. In Borel v. Fibreboard Paper Prod. Corp., 493 F.2d 1076 (5th Cir. 1973), cert.denied, 419 U.S. 869 (1974), it was held that there was a duty to warn if a reasonable personwould want to know of the risk and then decide whether to take that risk. In Reyes v.Wyeth Laboratories, 498 F.2d 1264 (5th Cir. 1974), cert. denied, 419 U.S. 1096 (1974), thedefendant, a manufacturer of polio vaccine, had distributed information to public healthdepartments about the remote possibility of a recipient contracting polio from the vaccine.The court held the defendant liable to the plaintiff who contracted polio after the vaccinewas administered by a public health agency. Although a warning circular was contained inthe vaccine's packages, it was not seen by or read to the plaintiff's parents. Id. at 1270. Thecourt reasoned that because it was foreseeable that the vaccine would not be administeredby a prescribing physician, the risk, regardless of how remote, was one the consumer wouldwant to know, and thus the package circular was an inadequate warning. Id. at 1277-78.

132. See supra note 131.

133. Id.

134. See RESTATEMENT (SECOND) OF TORTS § 388 (1965); see also 72 C.J.S. ProductsLiability § 27 (Supp. 1975).

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through the various stages of its marketing scheme."35 In other words, itmay be necessary to issue warnings and instructions to individuals otherthan the ultimate users and/or consumers originally mentioned in402A.13

6 For example, if the product is one capable of inflicting harmwhile on display in a shop, prospective customers and shoppers should bealerted accordingly.1 3 7 Unfortunately, this is a problem that often be-comes more clear after a damaging event has taken place. Therefore, thesolution to avoiding liability is to warn or instruct all foreseeable plain-tiffs. 38 The issue of foreseeability, more often than not, will be a questionof fact for the jury.1 39 This seems to be the most effective means of dis-cerning exactly to whom these warnings and instructions should be given.

The issues of obvious dangers and misuse, discussed with regard todesign defects, resurface in the arena of marketing defects. In this regard,it should be noted that unlike misdesigned goods, there is no duty towarn against obvious dangers.14 ' As one court has said, "We hardly be-lieve it is anymore necessary to tell an experienced factory worker that heshould not put his hand into a machine that is at that moment breakingglass than it would be necessary to tell a zookeeper to keep his head outof a hippopotamus' mouth."'' The real question in cases of this nature iswhether the danger in question was obvious. 4" In many instances, reason-able minds will differ on this point, so the question is often one for the

135. See Giordano v. Ford Motor Co., 165 Ga. App. 644, 299 S.E.2d 897 (1983) (manu-facturer of component part of larger product may have duty to warn ultimate user ofhazards connected with part).

136. See McLaughlin v. Mine Safety Appliances Co., 11 N.Y.2d 62, -, 181 N.E.2d430, 433, 226 N.Y.S. 2d 407, - (1962) (duty to warn extends to ultimate purchasers, theiremployees, and to third persons exposed to foreseeable risk).

137. See, e.g., Davis v. Gibson Prod. Co., 505 S.W.2d 682 (Tex. Civ. App. 1973), writref'd, no rev. err. (failure to place sharp machetes out of reach of customers and failure towarn customers as to danger constituted sufficient evidence to require submission of issuerelating to strict liability to jury).

138. Mitchell v. Miller, 26 Conn. Supp. 142, -, 214 A.2d 694, 699 (1965) (policywhich protects user/consumer should also protect bystander); see also supra text accompa-nying note 130.

139. See Sills v. Massey-Ferguson, Inc., 296 F. Supp. 776 (N.D. Ind. 1969) (when lawnmower threw bolt that struck bystander, whether manufacturer should have warned by-stander was a question for the jury).

140. Bishop v. Firestone Tire & Rubber Co., 814 F.2d 437 (7th Cir. 1987) (manufacturerhas no duty to warn if danger is obvious).

141. Bartkewich v. Billinger, 432 Pa. 351, -, 247 A.2d 603, 606 (1968).

142. Ragsdale v. K-Mart Corp., 468 N.E.2d 524, 527 (Ind. Ct. App. 1984) (whetherdanger is open and obvious is an objective test based on what the user should have known).

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jury.' 3 However, if it is clear that the condition in question is obvious,there is no corresponding duty to warn of its danger.44

Situations involving the misuse of a product, on the other hand, gen-erally depend upon the single element of foreseeability.'" If the product'smisuse is foreseeable, also a question of fact for the jury,'W then there is aduty to warn and/or to issue adequate instructions. 4

1 If, however, the useof the product in question was an unforeseeable one, there is no corre-sponding duty to warn and/or to issue instructions for the product'su s e . 4 s

A special problem is encountered in the marketing of a product whendealing with drugs and products that cause allergic reactions. Drugs aredivided into two categories: Those sold over-the-counter or those sold byprescription."' If the particular drug falls into the former category, thenall instructions and warnings should be given to the potential user/con-sumer.' ° If, on the other hand, the product is sold by prescription, thenthe required information should be given to the "learned intermediary"

143. -Jamieson v. Woodward & Lothrop, 247 F.2d 23, 37 (D.C. Cir. 1957) (Washington,J., dissenting) (question of fact as to whether manufacturer could justifiably expect user tobe aware of danger), cert. denied, 355 U.S. 855 (1957).

144. See Jamieson, 247 F.2d at 28.145. RESTATEMENT (SECOND) OF TORTS § 395 comment k (1965): "Foreseeable uses and

risks. The manufacturer may, however, reasonably anticipate other uses than the one forwhich the chattel is primarily intended. The maker of a chair, for example, may reasonablyexpect that someone will stand on it .... "

146. Moran v. Faberge, Inc., 273 Md. 538, -, 332 A.2d 11, 16 (1975) ("There is a vastmiddle ground of product uses about which reasonable minds could disagree as to whetherthey are or should be foreseeable to the manufacturer, thus requiring resolution by the trierof fact ... ."); see also Giordano v. Ford Motor Co., 165 Ga. App. 644, -, 299 S.E.2d 897,899 (1983) (duty to warn depends on foreseeability of use in question, danger involved, andforeseeability of consumer knowledge of danger, which are matters not compatible withsummary judgment).

147. Barth v. B.F. Goodrich Tire Co., 265 Cal. App. 2d 288, 71 Cal. Rptr. 306 (1968)(foreseeable to a tire manufacturer that tires would be subject to overloading and thereforehad a duty to inform and instruct users as to safe carrying capacity and to warn of thedanger of overloading).

148. Trotter v. Hamill Mfg. Co., 143 Mich. App. 593, -, 372 N.W.2d 622, 626 (1985)(where seat belt assembly was removed from a conventional automobile and installed bydecedent in a dune buggy, the court held that neither the seat belt manufacturer nor themanufacturer of the vehicle had a duty to warn of the danger of such an unforeseeable use).

149. See, e.g., Reyes v. Wyeth Laboratories, 498 F.2d 1264, 1276 (5th Cir. 1974), cert.denied, 419 U.S. 1096 (1974) (manufacturers have duty to warn ultimate purchasers of in-herent dangers in over-the-counter drugs, but producer of prescription drugs need only warnprescribing physician, a "learned intermediary" between manufacturer and consumer).

150. Wells v. Ortho Pharmaceutical Corp., 615 F. Supp. 262, 294-95 (N.D. Ga. 1985)(plaintiff on recommendation of physician purchased non-prescription spermicide, yet man-ufacturer still had duty to warn purchaser of product's side effects), afJ'd in part, modified


or prescribing physician.' 5 ' The most notable exception to this rule in-volves prescription drugs dispensed by some other means. If, for example,the drug is used in a mass inoculation, such as the polio vaccine, then aswith over-the-counter drugs, the rule is that the information should begiven directly to the patient.'5 2 The rationale for this rule is that the dis-pensing physician may not be present to warn or inform the person di-rectly of any impending danger. 53

In the case of allergic reactions to products, the jurisdictions havedeveloped three prevailing rules. One is that there is no duty to warn ofan idiosyncratic reaction to a product unless there is an "appreciablenumber" of individuals who are allergic to it."4 The second is that thereis a jury question as to whether a warning must be given if "some" indi-viduals will be hypersensitive to the product,'5 5 and finally, the moststringent position is that there must be an accompanying warning inthose instances where "a" person may suffer some harm from the use ofthe product.' The weight of recent authority, however, favors the firstposition.

57

in part, and remanded, 788 F.2d 741 (11th Cir. 1986), reh'g denied, 795 F.2d 89 (11th Cir.1986), cert. denied, 479 U.S. 950 (1986).

151. McKee v. Moore, 648 P.2d, 21, 24 (Okla. 1982) (regarding prescription products ordevices, the general rule is that the manufacturer has a duty to warn only the prescribingphysician).

152. Where a prescription med'cine is dispensed at a mass inoculation or public clinicwhen there is no prescribing physician, as an exception to the general rule, the manufacturerhas a duty to warn the patient foi (,on-over-the-counter drug medicines. Such use is foresee-able and in such cases the manufacturer is responsible for warning the consumer to balancethe risks against the drug's benefit. Re, !s, 498 F.2d at 1264.

153. Id. at 1276.154. See, e.g., Tayar v. Roux Laboratories, Inc., 460 F.2d 494, 496 (10th Cir. 1972)

(idiosyncratic reaction to hair rinse, normally safe to the public, did not entitle plaintiff torecover); Griggs v. Combe, Inc., 456 So. 2d 790, 793 (Ala. 1984) (manufacturer of over-the-counter drug not liable under theories of negligence, strict liability, or breach of impliedwarranty for failure to warn of injuries resulting from allergic reaction by hypersensitiveuser); Alberto-Culver Co. v. Morgan, 444 S.W.2d 770, 777 (Tex. Civ. App. 1969), writ ref'd,no rev. err. (plaintiff who was hypersensitive failed to show she was within the class of usersthat defendant could reasonably foresee); Presbrey v. Gillett Co., 105 Ill. App. 3d 1082, -,435 N.E.2d 513, 520 (1982) (rule barring idiosyncratic users from recovery'applies where suitis brought under negligence, warranty, or strict liability).

155. Holmes v. Grumman Allied Indus., 103 A.D.2d 909, __, 478 N.Y.S.2d 143, 145(1984) (notwithstanding small percentage of persons sensitive to subject chemical, possibil-ity of danger raised substantial fact issue).

156. McEwen v. Ortho Pharmaceutical Corp., 270 Or. 375, -, 528 P.2d 522, 530(1974) (not unreasonable to impose liability where product only dangerous to small percent-age of consumers).

157. RESTATEMENT (SECOND) OF TORTS § 402A comment j (1965) (warning requiredwhere product contains ingredient to which substantial number of population will be aller-gic); see also 72 C.J.S. Products Liability § 26b (Supp. 1975).


From the above discussion relating to "a defective product," one mayconclude that what was published in 1965 has evolved into a broader con-cept than intended by the framers of the second Restatement.'5 Thecourts have taken section 402A and extended it into areas most likely notcontemplated by the original drafters.'59 While this phenomenon is prob-ably best illustrated by the sections dealing with products and defects, itis by no means limited to these areas.

D. "[U]nreasonably dangerous . . ."

The phrase "unreasonably dangerous" was inserted in 402A to distin-guish between those products capable of causing injury and those prod-ucts causing injury because they are in a defective condition, and there-fore, unreasonably dangerous.1 6 0 In other words, there was a generalagreement that such products as butter, drugs, whiskey, cigarettes, andautomobiles can cause harm even though there is nothing wrong withthem. ' The intent of 402A, however, was to impose liability only when

158. Putman v. Erie City Mfg. Co., 338 F.2d 911 (5th Cir. 1964). In Putman, JudgeWisdom summarized the development of section 402A, pointing out that the original Re-statement of Torts had no provision for strict liability. Id. at 918-19.

In 1961, Tentative Draft No. 6 of the Restatement (Second) of Torts recommended theadoption of section 402A, but limited application to "food for human consumption." Appli-cation was expanded to include items of "intimate bodily use" and "products intended forexternal application or contact." However, in May, 1964, the final draft of section 402A wasapproved expanding the application to all products. See supra Section I. HistoricalBackground.

159. See supra Section I. Historical Background.160. RESTATEMENT (SECOND) OF TORTS § 402A (1965): "(1) One who sells any product

in a defective condition unreasonably dangerous to the user or consumer or to his propertyis subject to liability for physical harm thereby caused to the ultimate user or consumer, orto his property." (emphasis added)

161. RESTATEMENT (SECOND) OF TORTS § 402A comment i (1965):Unreasonably dangerous. The rule stated in this Section applies only where thedefective condition of the product makes it unreasonably dangerous to the user orconsumer. Many products cannot possibly be made entirely safe for all consump-tion, and any food or drug necessarily involves some risk of harm, if only fromover-consumption. Ordinary sugar is a deadly poison to diabetics, and castor oilfound use under Mussolini as an instrument of torture. That is not what is meantby "unreasonably dangerous" in this Section. The article sold must be dangerousto an extent beyond that which would be contemplated by the ordinary consumerwho purchases it, with the ordinary knowledge common to the community as to itscharacteristics. Good whiskey is not unreasonably dangerous merely because itwill make some people drunk, and is especially dangerous to alcoholics; but badwhiskey, containing a dangerous amount of fuel oil, is unreasonably dangerous.Good tobacco is not unreasonably dangerous merely because the effects of smok-ing may be harmful; but tobacco containing something like marijuana may be un-reasonably dangerous. Good butter is not unreasonably dangerous merely because,if such be the case, it deposits cholesterol in the arteries and leads to heart at-


the product was defective. The section was intentionally designed to pro-tect prospective defendants against undue liability' 2 and as a result, thisphrase was included. Consequently, an injured plaintiff is required to es-tablish that the damaging event was caused by a defective product, andthat this defective condition was an unreasonably dangerous one.1 3 Thus,a reasonable person would not have expected the harm.

Some states, such as California, have refused to follow this position,stating that it is too onerous to require a plaintiff to establish both ele-ments. 64 However, the majority view has decidedly rejected the Califor-nia rule, 6 ' and has required that a plaintiff allege and prove that theproduct was in a defective condition and unreasonably dangerous. 6 Asone court stated, "To speak in terms of 'defect' only causes confusion.... The key . . . is whether the product is 'unreasonably danger-ous.' ;"" In this respect, 402A has been followed verbatim.

E. "[T]o the user or consumer or to his property . . ."

One of the principle reasons for the adoption of 402A was the inabil-ity of the law of warranty to adequately deal with the issues that arose

tacks; but bad butter, contaminated with poisonous fish oil, is unreasonablydangerous.162. Greenman v. Yuba Power Co., 59 Cal. 2d 57, _, 377 P.2d 897, 901, 27 Cal. Rptr.

697, 701 (1962). Although published three years before the final draft of section 402A, Jus-tice Traynor, an author of the second Restatement, set forth in Greenman the common lawprecursor to section 402A, the basic aim of strict liability. "The purpose of such liability isto insure that the costs of injuries resulting from defective products are borne by the manu-facturers that put such products on the market rather than by injured persons who arepowerless to protect themselves." Id.

163. Phipps v. General Motors Corp., 278 Md. 337, -, 363 A.2d 955, 958 (1976) (inorder to recover in an action under section 402A, plaintiff must establish that the productwas in a defective condition when the product left control of the seller, was unreasonablydangerous to the user, the defect was the cause of injuries, and the product reached theconsumer without substantial change in condition).

164. Cronin v. J.B.E. Olson Corp., 8 Cal. 3d 121, -, 501 P.2d 1153, 1163, 104 Cal.Rptr. 433, 443 (1972) (to require proof of both product defect and unreasonably dangerouscondition places greater burden on injured plaintiff than is required in Greenman).

165. See, e.g., Burns v. Riddell, Inc., 113 Ariz. 264, -, 550 P.2d 1065, 1067 (1976)(citing O.S. Stapley Co. v. Miller, 103 Ariz. 556, 447 P.2d 248 (1968)) (Arizona specificallyadopted section 402A and the concept of unreasonably dangerous defect, rejecting the Cali-fornia approach); Potthoff v. Alms, 41 Colo. App. 51, -, 583 P.2d 309, 311 (1977) (majorityof states clearly mandate defective product must be shown to be unreasonably dangerous foraction in strict liability to prevail); Heldt v. Nicholson Mfg. Co., 72 Wis. 2d 110, -, 240N.W.2d 154, 157 (1974) (unreasonably dangerous is essential element of product liabilityaction).

166. Cepeda v. Cumberland Eng'g Co., 76 N.J. 152, -, 386 A.2d 816, 828 (1978)(plaintiff must prove that article which caused injury was unreasonably dangerous).

167. Ross v. Up-Right, Inc., 402 F.2d 943, 947 (5th Cir. 1968).


when the damaging event injured a person who was not in privity withthe seller of the defective product.16 8 The need for a contractual relation-ship between the plaintiff and the defendant in order to recover had longbeen on the decline.169 The adoption of strict liability finally did awaywith the issue of privity. The drafters of the section made relief availableif personal injury was sustained by the user, the consumer, or the prop-erty of either.'7 0 The courts, however, have once more extended the provi-sions of 402A to provide a remedy not mentioned in the original text.

Cases involving the innocent bystander are illustrative.1 7' There isgeneral agreement that since the bystander has no voice in the selectionof the product, nor any say in the inspection of the goods, nor any influ-ence in the manner in which it is to be used, he or she more than anyother person involved in the damaging event, should be protectd by402A.'17 ' Imposition of 402A in cases involving innocent bystanders is fur-ther justified by the belief that it is equitable since no additional burdenis placed upon the seller. Since "[tihe same precautions required to pro-tect the buyer or user would generally do the same for the bystander,"

168. Winterbottom v. Wright, 152 Eng. Rep. 402 (1852). The decision of Winterbot-torn held products liability actions in check for over 60 years. The plaintiff sued the manu-facturer of a stagecoach supplied to the British government for damages when the defectivevehicle overturned, causing injury. The court held that without privity of contract, the lawwould provide a means of letting in an "infinity of actions" leading to "absurd and outra-geous consequences." Id. at 404-05.

169 See, e.g., MacPherson v. Buick Motor Co., 217 N.Y. 382, 111 N.E. 1050 (1916). InMacPherson, Justice Cardozo created the eminently-dangerous-product exception to theprivity requirement, stating that a rule that extended liability beyond contracting partieswas not an anomaly when injury to others was a foreseeable result. Id. at -, 111 N.E. at1054.

170. RESTATEMENT (SEcoND) OF TORTS § 402A (1965): "(1) One who sells any productin a defective condition unreasonably dangerous to the user or consumer or to his propertyis subject to liability for physical harm thereby caused to the ultimate user or consumer, orto his property."

171. RESTATEMENT (SECOND) OF TORTS § 402A comment o (1965). The drafters of sec-tion 402A recognized the possible need to protect those who come into casual or uninten-tional contact with a defective product, but who are by definition beyond the scope of"user" or "consumer." The drafters stated that there was no essential reason why plaintiffs,such as bystanders, should be deprived of the protection of section 402A, but neither ap-proved nor disapproved of such an expansion of the rule.

172. See Elmore v. American Motors Corp., 70 Cal. 2d 578, 587, 451 P.2d 84, 89, 75Cal. Rptr. 652, 657 (1969) (bystander has no opportunity to inspect product or limitpurchase to only products from reputable manufacturers and is therefore in greater need ofprotection from defective products); see also Giberson v. Ford Motor Co., 504 S.W.2d 8, 11(Mo. 1974) ("[Blecause of inability to 'kick the tires' the bystander is in need of more pro-tection .... " (quoting Howes v. Hansen, 56 Wis. 2d 247, -, 201 N.W.2d 825, 831 (1972))).

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there is no resulting hardship. 7 3 The result, however, is that once again,the text has been extended beyond its original terms.

F. "[I]s subject to liability for the physical harm thereby caused to theultimate user or consumer, or to his property.

It may appear obvious that the intent of 402A is to compensate forphysical injuries or property damage sustained by users and consumers.The courts, however, have in some instances projected the coverage ofthis section far beyond its apparent scope.

In one of the earliest cases, the Supreme Court of New Jersey ex-tended 402A to include economic loss. In Santor v. A. & M. Karagheu-sian, Inc.' 74 the plaintiff purchaser's only compensable injury was thepurchase price. After laying carpet, it became apparent that it was defec-tive. A line, due to an improper dying process, became increasingly no-ticeable. As the pile wore down, the line became worse and two additionallines appeared.175 Plaintiff brought suit, and in a unanimous decision, thecourt held that a cause of action could be maintained against the manu-facturer on either of two theories: Breach of implied warranty of reasona-ble fitness or strict liability.'76 The court reasoned that liability was im-posed in this case to insure that the cost of injury was borne by theproduct manufacturer who put the product into the stream of com-merce. 77 In other words, if an individual sustained loss, whether to theperson, property, or of an economic nature, as a result of a defectiveproduct placed into the market place, the manufacturer would be heldstrictly liable.

Barely four months after Santor was decided, it was rejected by theSupreme Court of California in Seely v. White Motor Co.' 7

8 Plaintiff hadpurchased a truck manufactured by the defendant. After taking posses-sion, it became obvious that the vehicle was defective. When the brakesfailed and the truck overturned, plaintiff brought suit seeking to recoverdamages related to the repair of the truck and damages for loss of busi-

173. Giberson, 504 S.W.2d at 12.174. 44 N.J. 52, -, 207 A.2d 305, 312 (1965) (where only damage is to product sold

and other property, manufacturer is still strictly liable to consumer).175. Id. at -, 207 A.2d at 307.176. Id. at -, 207 A.2d at 310, 312.177. Id. at -, 207 A.2d at 312 (strict liability arises from mere presence of product on

the market).178 63 Cal. 2d 9, -, 403 P.2d 145, 151, 45 Cal. Rptr. 17, 23 (1965) (doctrine of strict

liability governs distinct problems of physical injuries and has not superseded scheme ofrecovery under breach of warranty).

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ness due to the accident.'7 9 The California Supreme Court affirmed thetrial court's award of damages in the amount of the payments made pluslost profits on the grounds that defendant manufacturer had breached anexpress warranty to plaintiff.' s0 The majority opinion, written by ChiefJustice Traynor, condemned Santor's application of strict liability princi-ples to a case involving economic loss alone.'"' In effect, Justice Traynoremphasized that strict liability was applicable only when the injuries wererelated to the safety of the product, not for the violation of a contractualexpectation.182

After almost twenty-five years, Seely appears to represent the major-ity position on the issue of whether strict liability should apply when eco-nomic loss is plaintiff's only injury. ' s3 Nevertheless, it is clear that onceagain, some courts have gone beyond the intended limits of 402A.

Punitive damages represent another area in which the courts haveextended the scope of this section."8 Nowhere in the ambit of 402A areexemplary damages provided for, yet the courts have had no difficulty inawarding them.18 In fact, some of the more noteworthy decisions involve

179. Id. at -, 403 P.2d at 147-48, 45 Cal. Rptr. at 19-20.180. Id. at , 403 P.2d at 148, 45 Cal. Rptr. at 20.181. Id. at -, 403 P.2d at 151, 45 Cal. Rptr. at 23 (strict liability was designed to

govern problem of physical injuries, not undermine warranty).

182. Id.183. See, e.g., Sanco, Inc. v. Ford Motor Co., 771 F.2d 1081, 1084 (7th Cir. 1985) (ma-

jority of jurisdictions have not permitted recovery of purely economic losses in negligence orstrict liability action); Arizona v. Cook Paint & Varnish Co., 391 F. Supp. 962, 971 (D. Ariz.1975) (laws of Alaska, Arizona, California, Hawaii, and Texas do not permit recovery ofpurely economic loss under theory of strict liability), aff'd, 541 F.2d 226 (9th Cir. 1976), cert.denied, 430 U.S. 915 (1977); Clark v. International Harvester Co., 99 Idaho 326, -, 581P.2d 784, 791 (1978) (purchaser of defective product who sustained only economic loss, butno personal injury or property damage, cannot recover in products liability action againstmanufacturer); see also Washington Water Power v. Graybar Elec. Co., 112 Wn.2d 847, 774P.2d 1199 (1989) (product liability act preempts common law remedies, therefore no recov-ery allowed for economic loss).

184. See, e.g., Gillham v. Admiral Corp., 523 F.2d 102, 109 (6th Cir. 1975) (under Ohiolaw, punitive damages may be awarded in products liability action where failure to designproduct or warn public amounted to conduct that was intentionally reckless, wanton, orgross), cert. denied, 424 U.S. 913 (1976); Gryc v. Dayton-Hudson Cnrp., 297 N.W.2d 727,741 (Minn. 1980) (in products liability action against manufacture, of pajamas which caughtfire and burned a child, jury could find that manufacturer's con uc, was with disregard forthe rights of others and award of punitive damages of $1,000,0,-.00 ,-as not excessive), cert.denied, 449 U.S. 921 (1980); Wangen v. Ford Motor Co., 97 Vi'. . 260, -, 294 N.W.2d437, 444-45 (1980) (punitive damages can be recovered on theory .17 strict product liabilitywhere defendant's conduct was outrageous).

185. See RESTATEMENT (SECOND) OF TORTS § 402A (1965).

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the recovery of such an award. Much has been written on this issue,186

and the pros and cons of these recoveries need not be discussed at pre-sent. The issue of punitive damages is mentioned here only to emphasizehow some courts have gone far afield of the original parameters of thesection.

G. "[I]f (a) the seller is engaged in the business of selling such a prod-uct .. ."

As noted above, even though the second Restatement speaks interms of a sale,18 7 it is clear that this term has been interpreted to mean"one who places into the stream of commerce."' 88 This is true regardlessof the means used to introduce the product in question into the marketplace."8 The courts, however, have been very strict in interpreting thissection as being applicable only to those transactions wherein the defend-ant is in the business of placing the product in question into the channelsof commerce.' 0 In other words, isolated transactions do not come withinthe realm of intended liability. If the defendants are engaged in the busi-ness of selling such a product, strict liability applies. If they are not thenthe injured plaintiff's remedy lies in some other area of law.' 9'

H. "[A]nd (b) it is expected to and does reach the user or consumerwithout substantial change in the condition in which it is sold"

In addition to establishing a defect, an injured plaintiff must also beable to allege and prove that the product was in its defective condition atthe time it left the defendant's control. 9 ' In fact, it may be a defense foran individual to be able to claim that the product was tampered with or

186. See, e.g., Annotation, Allowance of Punitive Damages in Products Liability Case,13 A.L.R. 4th 52 (1982); Allen, Controlling the Growth of Punitive Damages in ProductsLiability Cases, 51 J. AIR L. & COM. 567 (1986); Ausness, Retribution and Deterrence: TheRole of Punitive Damages in Products Liability Litigation, 74 Ky. L.J. 1 (1985-86).

187. RESTATEMENT (SECOND) OF TORTS § 402A (1965).188. See, e.g., Link v. Sun Oil Co., 160 Ind. App. 310, -, 312 N.E.2d 126, 130 (1974)

(the word "sell" is merely descriptive and product need not be actually sold if placed intostream of commerce by other means).

189. McKisson v. Sales Affiliates, Inc., 416 S.W.2d 787, 792 (Tex. 1967) (strict liabilityapplies to those who distribute samples in hopes of making future sales).

190. See Gardner v. Chevron U.S.A., Inc., 675 F.2d 658, 661 (5th Cir. 1982) (strictliability is not applicable to entities who construct a product but are not normally in thebusiness of selling such items); Bailey v. ITT Grinnell Corp., 536 F. Supp. 84, 87 (N.D. Ohio1982) (under Ohio law, occasional seller is not subject to strict product liability); Kaneko v.Hilo Coast Processing, 65 Haw. 447, _ 654 P.2d 343, 351 (1982) (the "occasional seller"exception applies to an ordinary person involved in the isolated sale of a product).

191. RESTATEMENT (SECOND) OF TORTS § 402A comment f (1965).192. Id. comment g.

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in some way altered, after it was placed into the stream of commerce. 9 3

This position is not only logical, but equitable as well. If one considers allof the policy arguments underlying the doctrine,'94 strict product liabilityshould only ensue when the product was in a defective condition at thetime it left the defendant's possession.'"1 Any other interpretation wouldresult, not in strict liability, but absolute liability.9 6 An individual wouldbe liable for events taking place after they were no longer in control,which was clearly never the intention of this section. In the interpretationof this part of the second Restatement, as was the case in the precedingdiscussion, the courts have closely adhered to the drafters' intent.

I. "The rule stated in Section (1) applies although (a) the seller hasexercised all possible care in the preparation and sale of his product

As clarified by the section noted above, negligence is never an issuein a product liability suit. Any argument that the defendant did what wasreasonable and/or prudent under the circumstances is not relevant. Thebasis of liability under 402A is strict products liability, and this is true inregard to the designing, manufacturing, and/or marketing of the productin question. 9 ' The fact that the defendant did, could have, or shouldhave foreseen harm and thus should have acted as a reasonable prudentperson to avoid it never arises. The only questions asked are: Was theproduct a defective one, and did this defect cause the damaging event?

J. "[A]nd (b) the user or consumer has not bought the product from orentered into any contractual relation with the seller"

Finally, this last part of 402A stresses that privity is no longer anissue. The fact that the user, consumer, or as we have seen, the innocentbystander has no contractual relationship with the defendant is immate-rial." 8 Privity, which was so important in the early days of product liabil-

193. See, e.g., Trotter v. Hamill Mfg. Co., 143 Mich. App. 593, -, 372 N.W.2d 622,625-26 (1985) (where defect is created by alteration, manufacturer or seller may not be heldliable); Burch v. Sears, Roebuck & Co., 320 Pa. Super. 444, -, 467 A.2d 615, 620 (1983) ("Ifthe condition of a product is substantially changed before it reaches the consumer, the man-ufacturer or seller will not be held strictly liable.").

194. RESTATEMENT (SECOND) OF TORTS § 402A comments g, h & i (1965).195. See, e.g., Colvin v. Robert E. McKee, Inc., 671 S.W.2d 556, 559 (Tex. Ct. App.

1984) (product must be shown to be defective when it left manufacturer).196. Gossett v. Chrysler Corp., 359 F.2d 84, 88 (6th Cir. 1966) (manufacturer is not

insurer).197. RESTATEMENT (SECOND) OF TORTS § 402A comment a (1965).198. Id. comment 1.

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ity law,'99 is no longer an element needed for recovery under this sec-tion.20 0 In fact, one of the early arguments in favor of adopting 402A wasthe inability of the courts to effectively deal with the problems that arosewhere privity did not exist.2 0' Presently, such issues are important onlyfrom a historical point of view.

III. CONCLUSION

The purpose of this article has been to illustrate that the section ofthe second Restatement enacted in 1965 is not necessarily the law that isin effect today. Now that two-and-one-half decades have passed since theadoption of 402A, much of the early uncertainty associated with it hasabated. For the most part, the concept and its elements are firmly estab-lished. What is clear, however, is that the apparent intent of the draftershas in some respects been altered. The section has been extended to in-clude events and individuals not mentioned in the original text. As a re-sult, today we can in effect restate the Restatement so as to reflect thecurrent law. Section 402A should now read as follows:

(1) One who places into the stream of commerce any product whichis defective in its manufacture, design, or marketing scheme and as suchis in an unreasonably dangerous condition to the user, consumer, or inno-cent bystander, or to that person's property is subject to strict liabilityfor physical harm and economic loss, and may be subject to liability forpunitive damages thereby caused to the ultimate user, consumer, or in-nocent bystander, or to that person's property, if (a) the seller is engagedin the business of placing such product into the stream of commerce, and(b) it is expected to and does reach the user, consumer, or innocent by-stander without substantial change.

(2) The rule stated in Subsection (1) applies although the defendanthas exercised all possible care in the manufacture, design, or marketingscheme of the product, and (b) there is a total lack of privity betweensuch parties.

199. See generally Feezer, Tort Liability of Manufacturers and Vendors, 10 MINN. L.REV. 1 (1925).

200. Prosser, supra note 37, at 791 (Henningsen v. Bloomfield Motors, 32 N.J. 358, 161A.2d 69 (1960), marked "the fall of the citadel of privity").

201. See generally Prosser, Assault Upon the Citadel (Strict Liability to the Con-sumer), 69 YALE L.J. 1099 (1960).

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Documents

Reflections on Section 402A of the Restatement (Second) of